Leadership must prove that it deserves support

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If you only react, you lose. Anyone who relinquishes control becomes a pawn in the markets, forces and speculation. Anyone who issues slogans about perseverance can only hope that at some point the trust will return and everything will somehow work out.

This is the picture given by Credit Suisse management. Scandal follows scandal. Before I had time to react to it, another fiasco rolled, which, as it seems to the public, remained out of sight of the authorities. This week, management was forced to acknowledge shortcomings in its control over financial reporting, which became apparent after the release of the company’s annual report. And now we have to ask for help from the National Bank, which throws out a lifeline for 50 billion.

The bank currently has more than enough liquidity. And a sufficient capital stock to absorb losses. However, no one really believes that CEO Ulrich Körner and President Axel Lehmann can stop the outflow of customer funds and restore confidence in their bank. They cannot share a vision or specific plans for how lost assets should be returned to Credit Suisse at some point.

Will the CS bosses dare send their tanker back to calm waters again?

At least here they will have the opportunity to act, and not just react. A clear demeanor, a show of leadership, an acceptance of responsibility is the least that is now expected from Koerner and Lehmann. From markets, customers, and last but not least, frontline CS employees who are currently unenviable.

The National Bank and Financial Markets Authority jumped to Credit Suisse’s side with an encouraging injection of cash. Bad enough that it had to come to this. But now it’s up to the big bank bosses to prove they deserve that backing. And know what to do with it.

Source: Blick